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What do Gen Zers need to know about money?

In an era marked by economic uncertainties and evolving societal norms, Generation Z faces unique financial challenges and opportunities. As the first generation to grow up entirely in the age of smartphones and social media, Gen Zers are navigating a world where financial literacy is more crucial than ever. Amid soaring living costs and the complexities of modern life, Jeannie Dougherty, a seasoned finance coach, offers sage advice to young individuals grappling with their finances.

Dougherty emphasizes the importance of budgeting, especially for those in Generation Z who are feeling the financial squeeze. “For Gen Zers who are struggling right now, I would say it’s incredibly important to build a budget and stick to it. With things like groceries and car payments being very expensive and with rent being exorbitant, it’s crucial to have a plan and guide showing what you have and what your main expenses are on an average month. A budget helps visually see and prepare for expenses throughout the year. Additionally, a budget can show if and where you can set aside money to start building your savings,” she shares. This guidance is not just about managing money; it’s about empowering young individuals to take control of their financial futures in an economic landscape that can often feel overwhelming.

In addition to budgeting, another aspect of financial planning that Gen Z is critically examining is the role of marriage and how it intersects with financial stability. Unlike previous generations, Gen Z places a significant emphasis on the financial implications of choosing a life partner. This shift reflects a pragmatic approach to relationships, where economic compatibility is as important as emotional and romantic compatibility. The focus on financial synergy suggests a collective understanding among Gen Zers that financial stress can strain relationships and that a shared approach to managing finances can foster stronger, more resilient partnerships.

Dougherty further elaborates on the importance of financial compatibility in relationships, highlighting that it’s about more than just the numbers. “When it comes to determining financial compatibility with a partner, it’s important to focus on seeing if you both align when it comes to your mutual and individual financial goals, including saving for a home, reducing debt, paying off debt, and feeling like you are each other’s equal support. Ask yourselves if you both hold a vision for the future and if that future includes fiscal responsibility. Ask yourself if you feel like your partner is against you, and if they make more or less if that will cause conflict down the road. It’s important to have common ground and similar values, and this is especially true when it comes to finances,” Dougherty explains. This perspective underscores the necessity of open and honest conversations about money, goals, and expectations early in relationships to build a solid foundation for the future.

The insights from Dougherty come at a time when financial education and literacy are more important than ever for young adults. The economic landscape faced by Gen Z—characterized by high costs of living, uncertain job markets, and the rapid evolution of technology—demands a proactive approach to financial management. Building a budget, understanding the financial aspects of relationships, and setting long-term goals are not just strategies for economic survival but are essential for creating a life of financial independence and security.

As Gen Z navigates these financial waters, the advice from experts like Dougherty serves as a beacon, guiding them toward a future where they can achieve their dreams without being unduly burdened by financial stress. It’s a reminder that in the complex world of personal finance, knowledge, planning, and communication are key to not just surviving, but thriving.

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